“Psystar…has built its business on infringing Apple’s copyrights and trademarks, free-riding on Apple’s research and development efforts, and trading on Apple’s hard-earned reputation for high quality, innovative and easy-to-use computers,” Apple said in its motion.

“Psystar’s appropriation of Apple’s intellectual property and goodwill has been systematic and brazen, from the name of Psystar’s ‘OpenMac’ computers to its deliberate pirating of Apple’s Mac OS X,” the company added.

“Psystar even seeks to profit from Apple’s efforts to protect its rights, extolling this litigation as Psystar’s ‘opportunity to gain market share,’ in a pitch to venture capitalists….Unless Psystar is permanently enjoined, it will not stop its unlawful conduct–conduct that is causing irreparable harm to Apple’s business, brand and goodwill.”

Catch that? Psystar was pitching VCs on its plan to use Apple’s IP to “compete directly against Apple.” Shameless. Little wonder Cupertino is so intent on burying the would-be rival.

And make no mistake, Apple legal is going to grind Psystar into fine silicon dust. In addition to the injunction, Apple is requesting compensation for legal costs and statutory damages owed under the Copyright Act and the Digital Millennium Copyright Act. And according to Apple’s expert witness, statutory damages for the former should run “between $1500 and $300,000″ and for the latter “between $449,500 and $4,495,000.”

Suffice it to say, that’s quite a bit more than the current value of Psystar’s assets which, according to its bankruptcy filing, are no more than $50,000.

“Psystar has violated Apple’s exclusive reproduction right, distribution right, and right to create derivative works,” Alsup wrote in his ruling (see full text below). Not only did the company infringe on Apple’s (AAPL) copyrights by installing Mac OS X on its hackintoshes, he explained, it violated the Digital Millennium Copyright Act to do so.

An ugly defeat for Psystar, which just a few weeks ago asked a judge to bless its business and rule that it is legally allowed to sell machines with Apple’s Mac OS X pre-installed. Still, it doesn’t mean that the acrimonious legal battle between the two companies is finished. Psystar could appeal, though Alsup’s ruling would seem to leave the company pretty far up that certain creek it’s been traveling lately–without a paddle.

There remain a number of accusations to be decided at trial, among them, Apple’s claims of breach of contract, trademark infringement, trademark dilution and unfair competition. Beyond these, there are the damages that will almost certainly be brought against Psystar on the copyright issues in the case.

“The court asked for briefs on that subject,” Pamela Jones notes over at Groklaw. “In short, Psystar is toast. Psystar’s only hope now is Florida, and frankly I wouldn’t bet the house on that one. Judges notice if you were just found guilty of a similar cause of action in another state.”

Psystar –

Also: Debtor is suffering under mounting legal costs as it is steadily beaten into submission by Apple (AAPL) and its notoriously vicious legal team.

Pystar’s bankruptcy declaration will delay Apple’s copyright-infringement suit against it, but only temporarily. In the meantime, the company will be allowed to continue to do business and perhaps, strengthen its defense. But on June 5, the date of its bankruptcy hearing, things could get nasty. Psystar will almost certainly be forced to reveal its financial backers, and if they are the nefarious Svengalis that Apple claims, there may be hell to pay.

The unauthorized Mac clone maker has won the right to continue its countersuit against Apple. In an order signed last Friday, U.S. District Court Judge William Alsup ruled that Psystar–whose antitrust complaint against Apple was tentatively dismissed last year–can refocus that complaint around copyright misuse. “Psystar may well have a legitimate interest in establishing misuse [of copyright] independent of Apple’s claims against it–for example, to clarify the risks it confronts by marketing the products at issue in this case or others it may wish to develop,” Alsup wrote in his order. “Moreover, if established, misuse would bar enforcement (for the period of misuse) not only as to defendants who are actually party to the challenged license but also as to potential defendants not themselves injured by the misuse who may have similar interests.”

The ruling is something of a setback for Apple (AAPL), which had argued that Psystar’s request to resubmit an amended counterclaim was a transparent “attempt to repackage its dismissed antitrust allegations under the guise of copyright misuse.” Because if Psystar does somehow manage to prove that Apple abused copyright laws, it could open up the market for Mac clones–or at least make it quite a bit more difficult for Apple to drop the hammer on other companies intent on peddling them.

Of course, if legal avenues fail it, Apple could easily hamstring clone makers in other ways. After all, it’s not incumbent on the company to ensure that its operating system works on non-Apple hardware, is it?

On information and belief, PSYSTAR alleges that APPLE intentionally embeds code in the Mac OS that causes the Mac OS to malfunction on any computer hardware system that is not an Apple-Labeled Computer Hardware System. Upon recognizing that a computer hardware system is not an Apple-Labeled Computer Hardware System, the Mac OS will not operate properly, if at all, and will go into what is colloquially known as ‘kernel panic.’

PSYSTAR is informed and believes, and thereon alleges, that APPLE is engaged in anticompetitive conduct that prevents the proper operation of the Mac OS on any computer hardware system that is not an Apple-Labeled Computer Hardware System–a Mac OS Capable Computer Hardware System–thereby forcing customers of the Mac OS to purchase–and only purchase–an Apple-Labeled Computer Hardware System if they wish to have the Mac OS operate sans kernel panic or an infinite loop.”

That’s an intriguing allegation. Risky though, since it’s also an admission that Psystar has circumvented the technological copyright-protection measures built into OS X, just as Apple claims in its amended complaint against the company. Apple contends Psystar has done so illegally, in violation of The Digital Millennium Copyright Act. Psystar says that’s impossible because the kernel panic-forcing code at issue here isn’t a copyright-protection measure.

Who’s right? Who knows? But if it’s Apple, then Psystar presumably is guilty of circumventing Apple’s copyright protection systems under the DMCA. And that’s a felony, because Psystar profited from the circumvention.

Sued by Apple in August for violating the terms of its shrink-wrap license, trademark and copyright on OS X, Psystar replied in kind with a countersuit charging Cupertino with restraint of trade, unfair competition, and other violations of antitrust law. Apple, Psystar argued, engages in all manner of anticompetitive conduct to “protect its valuable monopoly in the Mac OS market.”

But according to the California judge presiding over the case, Apple’s products don’t constitute a market to dominate. And that being the case, Apple (AAPL) can’t be considered a monopolist.

“The counterclaim explains that Mac OS performs the same functions as other operating systems,” Judge William Alsup wrote in his order dismissing the suit. “The counterclaim admits that market studies indicate that, although Apple computers with Mac OS enjoy strong brand recognition and loyalty, they are not wholly lacking in competition. Psystar also points to Apple’s extensive advertising campaigns. Those advertising campaigns more plausibly support an inference contrary to that asserted in the counterclaim–vigorous advertising is a sign of competition, not a lack thereof. If Mac OS simply had no reasonable substitute, Apple’s vigorous advertising would be wasted money. The advertising campaigns suggest a need to enhance brand recognition and lure consumers from a competitor…. Apple asks its customers to purchase Mac OS knowing that it is to be used only with Apple computers. It is certainly entitled to do so.”

By injecting nuclei from mice frozen for 16 years directly into unfertilized mice eggs, a team of Japanese geneticists was able to create healthy clones of the dead animals. Quite a breakthrough, and one that implies the cloning of cryogenically frozen humans and the resurrection of extinct animals frozen in permafrost is perhaps a little less improbable than originally thought. “Cloning animals by nuclear transfer provides an opportunity to preserve endangered mammalian species,” the researchers wrote in a paper submitted to The Proceedings of the National Academy of Sciences “[The technique] could be used to ‘resurrect’ animals or maintain valuable genomic stocks from tissues frozen for prolonged periods without any cryopreservation.”

Using it to produce a Crichtonian Jurassic Park, however, is quite a ways off. “It remains to be shown whether nuclei can be collected from whole bodies frozen without cryoprotectants and whether they will be viable for use in generating offspring following nuclear transfer,” the researchers noted. “However, it has been suggested that the ‘resurrection’ of frozen extinct species (such as the woolly mammoth) is impracticable, as no live cells are available, and the genomic material that remains is inevitably degraded.”

The suit, filed in U.S. District Court for the Northern District of California, seeks unspecified, triple damages and, more importantly, an order voiding Apple’s end-user license agreements (EULA). If successful, it will allow OS X to be installed on hardware it was never intended to run on, opening the door for the first legitimate Mac clones in more than a decade. Hard to see Apple (AAPL) allowing that to happen, though. My guess is the company would sooner kill retail sales of OS X and manage upgrades through iTunes, than allow it to be run on inferior machines over whose quality it has no control.